Skittish investors, wary about the health of the world economy, pushed the Dow industrials to their largest decline in two months, propelled in part by reports of a deepening global oil glut that sent crude prices to five-year lows.

The benchmark U.S. oil price slid 4.5% on the New York Mercantile Exchange, to $60.94 a barrel, bringing year-to-date losses to 38%. The declines delivered the latest blow to an oil industry that just months ago was thought to be booming, as many analysts and observers predicted that crude prices...